Judge Kills Allowance for Madoff Bro

Rulings in response to lawsuits also extend freeze to feeder funds
By Rob Quinn,  Newser Staff
Posted Apr 1, 2009 4:37 AM CDT
The building where Bernard L. Madoff Investment Securities LLC, have their offices in New York. Peter Madoff was brother Bernard's No. 2 at the firm for decades.   (AP Photo/Diane Bondareff)
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(Newser) – A appeals judge yesterday nixed a deal that gave Bernard Madoff brother Peter a $10,000 monthly allowance out of his frozen assets, reports the New York Daily News. The ruling, which came in response to a suit from a law student who lost his $500,000 inheritance, prevents him from accessing his fortune to pay his expenses. His outraged lawyer complained that his client can't even buy a cup of coffee.

Meanwhile, a Connecticut judge yesterday extended the freeze on the assets of the Madoff's family—including Bernard's wife, his sons, and his brother—to those of the feeder investment funds that supplied clients, the Wall Street Journal reports. This move came in response to a lawsuit filed by the town of Fairfield, Conn., which lost $15 million in principal invested in the ponzi scheme.